The finality trap, appealing CAFA remands, the timeliness of government appeals, and appeals in multidistrict litigation.
July 13, 2021
Last week saw a possible variation on the Fifth Circuit’s finality trap: the plaintiff voluntarily dismissed some of its claims before the district court dismissed the remainder. Thankfully the Fifth Circuit saw no effort to manufacture an appeal and concluded that the district court’s dismissal was appealable.
In other decisions, the Eighth Circuit reviewed a remand under CAFA’s local-controversy exception. The Federal Circuit said that the government’s notice of appeal was timely even if the Solicitor General had not yet authorized the appeal. And the D.C. Circuit dismissed an appeal from the settlement of only some class-action claims in multidistrict litigation.
- The Fifth Circuit on the Finality Trap and Pre-Resolution Voluntary Dismissals
- The Eighth Circuit Heard an Appeal From a CAFA Local-Controversy Remand
- The Federal Circuit on the Timeliness of Government Appeals and the Solicitor General’s Authorization
- The D.C. Circuit Dismissed an Appeal From the Resolution of Only Some Claims in Multidistrict Litigation
The Fifth Circuit on the Finality Trap and Pre-Resolution Voluntary Dismissals
In United States v. Eli Lilly & Co., the Fifth Circuit held that the voluntary dismissal of some claims does not preclude the later resolution of all remaining claims from being final.
Simplifying a bit, Eli Lilly was a qui tam suit against a pharmaceutical company and several other defendants for violations of the Anti-Kickback Statute. Sometime after filing its complaint, the plaintiff voluntarily dismissed all of its claims against the other defendants without prejudice. So the only remaining defendant was the pharmaceutical company. The United States—who had declined to intervene in the case—later moved to dismiss the suit. The district court granted that motion, and the plaintiff appealed.
In the Fifth Circuit, a voluntary without-prejudice dismissal of some claims can prevent a district court’s resolution of other claims from being final and appealable. To hold otherwise, the court says, would allow plaintiffs to manufacture an interlocutory appeal: the plaintiff can appeal the district court’s decision and, regardless of the appeal’s outcome, later reinstate the voluntarily dismissed claims. To appeal the district court’s decision, a plaintiff must instead obtain a partial judgment under Federal Rule of Civil Procedure 54(b).
Eli Lilly was different from other recent decisions on without-prejudice dismissals. These cases normally involve a plaintiff voluntarily dismissing all remaining claims after the district court has resolved some of the claims. In Eli Lilly, the plaintiff voluntarily dismissed some of its claims before the district court dismissed the rest.
That difference mattered for finality. The plaintiff did not voluntarily dismiss some of its claims to manufacture an appeal. It couldn’t have—when the plaintiff dismissed those claims, there was not yet a district court decision to appeal. The plaintiff instead sought to streamline the action in the district court. So the without-prejudice dismissal that came before the district court’s resolution of all remaining claims did not preclude finality.
United States v. Eli Lilly & Co., 2021 WL 2821116 (5th Cir. July 7, 2021), available at the Fifth Circuit and Westlaw.
The Eighth Circuit Heard an Appeal From a CAFA Local-Controversy Remand
In Kitchin v. Bridgeton Landfill, LLC, the Eighth Circuit reviewed an order remanding a suit to state court under the Class Action Fairness Act’s local-controversy exception.
Kitchin involved an environmental class action originally filed in state court. The defendants removed the case to federal court under the Class Action Fairness Act, which is commonly called “CAFA.” CAFA permits the removal of certain state court class actions to federal court. If the district court lacks jurisdiction over the removed case, it must remand the case to state court. Even if a district court has jurisdiction, it can decline to to exercise jurisdiction under CAFA’s local-controversy exception. The district court in Kitchin invoked this exception and remanded the suit to state court. The defendants then appealed.
Appellate jurisdiction over these remands is nuanced. Sometimes CAFA remands fall under 28 U.S.C. § 1447(d)’s general prohibition on appealing remand orders. But even if § 1447(d) applies, litigants can seek permission to appeal under CAFA’s discretionary-appeal provision, 28 U.S.C. § 1453(c). And sometimes § 1447(d) doesn’t apply to a CAFA remand. The Supreme Court has held that § 1447(d)’s bar applies only to remands under § 1447(c)—remands due to a procedural defect or lack of subjection-matter jurisdiction. Remands for any other reason are appealable as final decisions.
In Kitchin, the district court had remanded the suit under CAFA’s local-controversy provision. The local-controversy provision is a non-jurisdictional abstention doctrine. So the a local-controversy remand is not a remand under § 1447(c). The Eighth Circuit has accordingly held that § 1447(d) does not apply to remands under the local-controversy exception. The Eighth Circuit thus had jurisdiction to review the remand in Kitchin as a final decision under 28 U.S.C. § 1291.
Kitchin v. Bridgeton Landfill, LLC, 2021 WL 2833041 (8th CIr. July 8, 2021), available at the Eighth Circuit and Westlaw.
The Federal Circuit on the Timeliness of Government Appeals and the Solicitor General’s Authorization
In Rudisill v. McDonough, the Federal Circuit held that the government’s notice of appeal was timely even though the Solicitor General had not yet authorized the appeal.
The Solicitor General determines whether and to what extent the government will appeal. And “[t]he filing of a notice of appeal is deemed to be a determination ‘whether’ an appeal will be taken, which the Solicitor General is required to approve.” But sometimes the Attorney General (which represented the government in Rudisill) will file a notice of appeal before the Solicitor General approves of the appeal. This is done to protect the government’s right to appeal. The government normally has 60 days to appeal. But sometimes the Solicitor General needs more than those 60 days to decide whether to appeal. In those cases, the government might file a protective notice of appeal pending the Solicitor General’s decision.
That was the case in Rudisill. The government filed a timely notice of appeal. The Solicitor General’s approval came several months later. But this late approval did not affect the timeliness of the appeal. “The Attorney General has plenary power over the conduct of litigation to which the United States is a party, and a regulation defining the jurisdiction of the Solicitor General does not foreclose the Attorney General from directing that a notice of appeal be filed.” So “any delay in approval by the Solicitor General does not negate the timeliness of a Notice of Appeal filed by the Attorney General, and they have authority to file protective notices of appeal pending the Solicitor General’s decision whether to authorize the appeal.”
Rudisill v. McDonough, 2021 WL 2835316 (Fed. Cir. July 8, 2021), available at the Federal Circuit and Westlaw.
The D.C. Circuit Dismissed an Appeal From the Resolution of Only Some Claims in Multidistrict Litigation
In In re Domestic Airline Travel Antitrust Litigation, the D.C. Circuit dismissed an appeal that challenged the settlement of only some of the plaintiffs’ claims in multidistrict litigation.
Simplifying a fair bit, Domestic Airline Travel involved the consolidation of several antitrust class-actions in multidistrict litigation. The class settled all claims against two of the four defendants. But to avoid the potential of piecemeal settlement payments, the settling parties agreed to postpone distribution until resolution of the entire suit. Some members of the class objected to the settlement. The district court rejected those objections. The objectors then appealed.
The D.C. Circuit held that it lacked jurisdiction over the appeal. In multidistrict litigation, the resolution of a distinct action is final and appealable regardless of whether any other actions remain pending. But the settlement in Domestic Airlines Travel did not resolve any distinct actions. The settlement instead resolved claims against only two of the four defendants in the consolidated actions. So the settlement resolved neither the consolidated action nor any of the individual actions. It wasn’t appealable.
In re Domestic Airline Travel Antitrust Litigation, 2021 WL 2878591 (D.C. Cir. July 9, 2021), available at the D.C. Circuit and Westlaw.